Seven of eight regions in the state are highly concentrated under federal merger guidelines

WMC cites findings in renewed push for price transparency

Wisconsin’s regional hospital markets became more concentrated between 2018 and 2025, and mergers and other ownership changes account for most of the increase, according to a report released Tuesday by the Center for Research on the Wisconsin Economy at UW-Madison.

The authors, Ike Brannon of the Jack Kemp Foundation and Anthony T. Lo Sasso of UW-Madison’s La Follette School of Public Affairs, found that seven of the state’s eight hospital referral regions are highly concentrated under federal merger guidelines.

Wisconsin Manufacturers & Commerce seized on the report the same day.

“When patients and employers have fewer options, prices rise,” said Rachel Ver Velde, WMC’s associate vice president of government relations.

What the study measured

Brannon and Lo Sasso used Wisconsin Hospital Association inpatient discharge files covering every quarter from 2018 through 2025. Their analysis covers 139 general acute-care hospitals and 4,152,865 discharges from all payers, about 92 percent of the state’s inpatient discharges. Psychiatric, rehabilitation, children’s-only and other specialty hospitals were left out, as were federal facilities such as VA hospitals.

They gauged concentration with the Herfindahl-Hirschman Index, the yardstick federal antitrust agencies use. A single hospital system with the entire market scores 10,000. Under the 2023 merger guidelines from the U.S. Department of Justice and the Federal Trade Commission, a market above 1,800 is considered highly concentrated.

Across the eight regions, weighted by population, the average score rose from 2,520 in 2018 to 2,857 in 2025. Every region went up.

Wausau is the most concentrated, at 5,702, with Aspirus handling 72 percent of the region’s discharges. La Crosse follows at 4,202 and Appleton at 3,826.

Madison, at 1,726, is the only region under the 1,800 line. That is because the authors counted UW Health and UnityPoint Health-Meriter as separate firms even though the two have operated under a joint operating agreement since 2017. Counted as one, Madison’s score jumps to 2,710 and all eight regions would be highly concentrated.

Mergers, closures and patient choice

To sort out why concentration rose, the authors held ownership constant and let patient volumes change, then did the reverse. Ownership changes accounted for 58 percent of the increase. Patients shifting between hospitals accounted for 42 percent.

The single biggest jump came from Ascension’s 2021 sale of seven north-central Wisconsin hospitals to Aspirus. It raised the Wausau region’s score by 1,656 points, to 5,489, and lifted the Marshfield region by 282 points.

Closures moved the numbers too. When Hospital Sisters Health System closed Sacred Heart Hospital in Eau Claire and St. Joseph’s in Chippewa Falls in March 2024, the Marshfield region’s score rose 540 points, the largest single change the authors found in that region.

The report found no record that the FTC, the Justice Department or the Wisconsin attorney general sued to block, conditioned or publicly objected to any of the mergers it reviewed. It notes that federal premerger reviews are confidential, so regulators may have looked at some of the deals.

Comparison with Illinois

The authors also compared Wisconsin with Illinois using Medicare discharge data, since no all-payer source covers both states. Wisconsin’s regions averaged 2,832 in 2025, against 2,427 for Illinois as a whole. Outside the Chicago area, though, Illinois averaged 3,343, higher than Wisconsin.

That matters for the price question. An August report by the same two authors found Wisconsin hospital prices roughly 26 percent higher than Illinois prices for the same services. In the new report, they write that because the price gap was not driven by Chicago, local concentration “is unlikely to fully explain Wisconsin’s higher prices.”

They point instead to insurance. Health plans owned by Wisconsin hospital systems held 36 percent of the state’s fully insured commercial enrollment in 2024, compared with about 5 percent in Illinois, the report says.

Limits of the data

The report is descriptive and does not establish cause and effect, the authors write. The discharge files record hospital charges, not the prices insurers actually negotiate, and they cover only inpatient care, leaving out outpatient services that account for roughly half of hospital revenue. Because only Wisconsin hospitals report to the WHA, border regions such as Minneapolis-St. Paul and Duluth were excluded.

WMC’s push

WMC, the state’s chamber of commerce and manufacturers’ association, used the report to renew its call for hospital price transparency. The organization says 96 percent of employers support stronger hospital price transparency requirements.

“Wisconsin should advance meaningful healthcare price transparency reforms that empower patients, strengthen competition, and bring much-needed accountability to the healthcare marketplace,” Ver Velde said in the release.

The new report itself does not examine price transparency or recommend specific legislation. CROWE says the report represents the views and conclusions of the authors and not necessarily those of the center, UW-Madison’s economics department or the university.